Greencore Group Enters the US Chilled Prepared Foods Market
These relationships, taken together with Greencore’s distinctive operational capability in chilled prepared food, will enable the Group to accelerate the existing growth plans of HMBF to deliver a scale US business.
02/05/08 GREENCORE GROUP PLC, one of Europe’s leading convenience food and malt producers,announces the acquisition of Home Made Brand Foods Inc. ("HMBF"), a leading manufacturer in the chilled food market in the North East region of the United States. This acquisition marks the entry by Greencore into the growing chilled convenience food market in North America.
Based in Newburyport, Massachusetts, HMBF is a regional leader in fresh prepared food. It manufactures and supplies a range of fresh food products, including fresh prepared meals and salads, sandwiches and quiche to a customer base that includes leading regional retailers such as Stop & Shop, Hannaford and Publix. In the current year, HMBF expects to generate in excess of $40 million in revenues and has potential manufacturing capacity to increase this to $100 million within its existing facility. HMBF’s experienced management team, led by Rick Walters, will remain in place post the acquisition.
The initial consideration payable by the Group is $44 million. Further consideration will be payable up to a maximum of $10 million, dependent on HMBF’s performance in the financial year to 31 December 2008. The acquisition is expected to be modestly EPS accretive from FY09.
Over the past two years, Greencore has undertaken a detailed business development effort in the US chilled food market. The Group has deepened its knowledge of the market and established strong relationships with key regional and national retailers in the US, as well as with potential brand licensors. These relationships, taken together with Greencore’s distinctive operational capability in chilled prepared food, will enable the Group to accelerate the existing growth plans of HMBF to deliver a scale US business.
Greencore will relocate key personnel to the US to develop the Group’s US business. Fergal Leamy, currently development director of the Convenience Foods division, has been appointed CEO of Greencore USA and he will be joined in the US by other leaders in the areas of chilled food manufacturing, supply chain and product development.
